BUSINESS & ECONOMY

Workers Reel From Surging Layoffs as Shutdowns Ravage Economy

BY Jon Hurdle, NJ Spotlight |

Gov. Murphy says he’s working with neighboring states to demand help from federal government

The post Workers Reel From Surging Layoffs as Shutdowns Ravage Economy appeared first on NJ Spotlight.

Credit: Jon Hurdle
Loren Greene was laid off from her job at an East Brunswick restaurant; she is pictured here with a coworker.

Loren Greene worked two jobs while getting her master’s degree in social work from Rutgers University in New Brunswick, and now she has neither, thanks to the coronavirus.

Greene, 25, worked about 30 hours a week as a server in an East Brunswick restaurant, where she was employed since 2012. On Monday this week, she was laid off along with the rest of the 15-strong workforce because the restaurant shut its doors to comply with Gov. Phil Murphy’s order for the closure of all nonessential food and retail establishments.

She also lost another position as a substitute teacher following the closure of schools statewide in an attempt to stop the spread of COVID-19, the disease caused by the virus.

The sudden loss of both jobs has left her without $400 to $500 a week, and may mean she’ll be forced to use the security deposit on her Milltown apartment to pay the next two months’ rent until her lease runs out on May 31.

After that, she may be forced to move in with her 64-year-old mother who lives in a one-bedroom apartment in Aberdeen, and had been planning to retire soon but may now be unable to do so because her 401k has been “basically wiped out” by the stock market meltdown as the virus has spread across the globe, Greene said on Thursday.

‘A lot of uncertainty’

“It’s a lot of uncertainty, a little bit of fear,” Greene said. “I’m trying to keep a positive attitude, but it’s also a bit scary. I tried to have a bunch of jobs in order to make it work no matter what, and now I have zero jobs.”

Greene, who is due to graduate in May, is also afraid that she may not be able to find a full-time job then because of the huge economic damage wrought by the virus.

New Jersey’s hospitality industry has already seen layoffs of around 80% of its 316,000 workers, according to an estimate from the New Jersey Restaurant and Hospitality Association, a trade group. Nationally, the industry predicted on Wednesday that it will be forced to lay off 5 to 7 million workers in the next three months, according to the National Restaurant Association.

In Trenton, Pierre Jaborska said he didn’t know whether he would be keeping his job as a production worker for a Hamilton graphics company because its orders have suddenly dried up as clients shut down in response to the virus.

“We do a lot of displays for stores, which are taking a huge hit right now,” he said. “We had some big jobs in the lineup, and now they have just disappeared or are on hold indefinitely.” The lost business includes a contract for Princeton University, which canceled after sending its students home.

Jaborska, 47, doesn’t get paid if he doesn’t work, and is worried about the household finances for himself and his wife, Dena, and their children, 9 and 12, if he is unable to work for an extended period.

“It’s going to cause financial problems because no work, no pay. It’s going to be tight,” he said.

He said his boss is trying to avoid laying people off but fears that he may have no choice because orders have come to a sudden stop.

Growing layoffs

The growing number of layoffs is already being seen in official statistics. The state’s Department of Labor said the number of initial claims for jobless benefits rose to 9,467 in the week ending March 14, which was 20.6% higher than the same week a year ago.

The governor on Thursday said many people have lost their jobs because of the pandemic “and those numbers are going up but not down.”

Murphy urged employers to avoid further layoffs, and said he hopes to announce a business assistance program shortly. He welcomed the federal Small Business Administration’s decision to allow small businesses to apply for federal disaster loans, and said New Jersey is working with neighboring states on a joint request for more federal assistance for business during the crisis.

“We’re going to continue to fight for stimulus packages that includes small business grants, and we will fight to ensure that any loans provided now could be paid down by grant funds,” he said during a news conference.

On Monday, Senate President Stephen Sweeney (D-Gloucester) urged businesses not to lay off their workers even if they are suffering a big drop in sales.

“We have a shared responsibility to protect the economic health of employers and the financial wellbeing of employees, especially those with modest incomes,” he wrote in a letter to business groups including the New Jersey Chamber of Commerce.

“If we do not stand firmly with not only the businesses but the workers of this state, we will be taking a bad situation and making it worse,” he wrote. “Massive layoffs and missed paychecks could lead to loan and mortgage defaults, unpaid rent, a slew of evictions and a rise in homelessness.”

A 20% jobless rate?

New Jersey Policy Perspective (NJPP), a liberal advocacy group, said 15,000 people filed for unemployment assistance on Monday alone, and warned that the increase “pales in comparison with what the state should expect to see in the coming weeks.”

If New Jersey ends up with a 20% jobless rate, as feared nationally by Treasury Secretary Steve Mnuchin, that could mean 900,000 New Jerseyans are without a paycheck, NJPP warned. It said the state could cushion the blow by adopting progressive tax policies like the millionaires tax.

In Ewing, Brooke Beck, 29, lost her job as a waitress in an Italian restaurant that closed on Saturday in response to the crisis. She said her income suddenly plunged to zero from about $700 a week, and she has now filed for unemployment. She doesn’t know how much she will get in benefits.

Her financial difficulties are compounded by the fact that her boyfriend, also a server in a restaurant, has also lost his job, raising questions about how to pay rent on the Stockton house they share. He is considering taking a job with Amazon, one of the few companies that’s hiring.

Beck, a graduate student of social work, said she doesn’t expect to get evicted because she has a “compassionate” landlord, but predicted the couple will have trouble paying their bills.

“We’ve been brainstorming about the type of projects we could do, like yard work,” she said. “But honestly, I don’t think that’s going to start up for a couple of weeks until the worst of this passes.”